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European Commission

Learn about the impact of REACH regulations on cost, innovation, and stakeholders. Explore economic vs. environmental considerations and the benefits of chemical management. Discover how REACH affects different industries and EU Member States.

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European Commission

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  1. European Commission Further Impact Assessment of REACH ETUC Conference Brussels, 11 February 2005 Patrick Hennessy DG Enterprise and Industry

  2. Why REACH? • General Public demands better information on chemicals • Inadequate chemical testing regime for “old” chemicals and backlog in evaluation • Need to maintain single market & establish level playing field in chemicals

  3. Commission Impact Assessment • Direct testing and registration costs • Wider costs to downstream users • Health and environmental benefits • Computer-based methods to reduce animal tests • Bureaucracy reduced following Internet consultation with 6000 replies

  4. Results of Commission Impact AssessmentOctober 2003 Balance between economic and environmental considerations • Direct costs € 2.3 billion • Overall costs: € 2.8 – 5.2 billion (incl. Direct costs) • Effect on innovation: probably positive • Overall benefits very difficult to quantify: possible health benefits: € 50 billion.

  5. Stakeholder Workshop in November 2003 Presentation of Commission Impact Assessment and discussion of key issues with the stakeholders (industry, trade unions, environmental NGOs) Three issues identified for further investigation: • Supply chain impacts: commercial substance withdrawal • Impacts on innovation • Impacts on New Member States

  6. Memorandum of Understanding between UNICE/CEFIC and EU Commission March 2004 Objectives: • Further specific studies on cost effectiveness • Inclusive and transparent process, involving all stakeholders Methodology: • Business case study (factual evidence) • Critical substances in significant value chain • Transparent investigation process and validation Time frame: results by early 2005

  7. Working Proceduresunder Memorandum of Understanding Working Group • Representatives from industry, trade unions (incl. EMCEF), NGOs, and Commission • Meets about once a month High-level Group • Commissioners, high level representatives of Council, European Parliament, industry, trade unions, and NGOs • First meeting in January 2005

  8. UNICE/CEFIC Industry consortium study KPMG Consultants • Scope: • Commercial substance withdrawal • Innovation and business benefits • 4 business cases on value chains within: • Automotive industry (e.g. vehicle engine) • High-Tech Electronics (e.g. Printed Circuit Boards) • Inorganics Industry (e.g. steel, cement) • Flexible Packaging (e.g. inks, adhesives)

  9. Study on REACH & the New Member States Commission Scientific Service (JRC/IPTS) • Sectoral overview and business cases of specialty chemicals industry and downstream users • Focus on Poland, Czech Republic, and Estonia • Comparable to KPMG study

  10. Study on REACH & SMEs in Textiles Industry Envirotex/CAST for DG Enterprise • Special focus on SMEs, both specialist chemical producers and textile mills • Impacts on management, legal, technical resources • Financing of testing and registration costs • Case studies, comparable to KPMG study

  11. Key Issues: Supply chain impacts • Size of testing and registration costs relative to future profitability (especially important for lower volumes) • The incidence of the commercial withdrawal of substance of critical importance for downstream users • Scope for substitution and pass-through • Effects on SMEs

  12. Key issues: Innovation impacts Identifying the positive and negative effects: • Higher volume thresholds for new substances • New R&D provisions • Time-to-market effects • Production flexibility effects • Induced-innovation: due to substitution or commercial withdrawal

  13. Expected Timetable from Now March Finalisation of studies April Presentation to Stakeholder Working Group and High Level Group May Discussion in European Parliament and Council of Ministers

  14. Moving Forward on REACHthe View of this Commission • No amended proposal before EP’s first Reading • Disposition to work closely with EP and Council to arrive at a balanced and workable solution • “The Commission stresses the need to arrive at a decision which will be consistent with the Lisbon goals as regards the competitiveness of European industries and encouraging innovation, and which will achieve a marked improvement in health and environment to the benefit of Europe’s citizens” (Lisbon Communication)

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